In our Homebuyer’s Seminar we illustrate the benefits of buying over renting by comparing $2,100 per month rent (market rent for a 2/2 in our area) vs. buying a small home for $400,000 with FHA financing (3.5% down). We use very conservative assumptions, and we show how people end up much better off financially when they buy.
We show buyers how their after-tax housing payment is only slightly higher than their rent payment. But more importantly, we use the Rent vs. Buy calculators to show FHA Buyers how they can end up with approximately $150,000 in equity after only 7 years. If they continue to rent, they will obviously have no equity in 7 years.
Conventional buyers putting 10% down will have around $180,000 of equity after 7 years.
We of course send out our rent vs. buy calculators to our borrowers as part of our education process. Here is one from Trulia that we like and recommend: http://www.trulia.com/rent_vs_buy/
Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646
